The owners of Toyota of Olympia have purchased nearly 28 acres in Tumwater for a commercial development that could possibly include the city’s first major auto dealership.
One unanswered question is whether the Toyota dealership will keep its current location at the Olympia Auto Mall — or take its sales tax revenue elsewhere.
Tumwater City Manager John Doan would not confirm details about plans for the undeveloped property, located at the northwest corner of Israel Road and Interstate 5. Doan said the addition of a major auto retailer — Tumwater has none — would help diversify the city’s sales tax base.
More information about the project will be released in the next couple of weeks, said Joe McCorkle, general manager at Toyota of Olympia.
Tumwater had included the wooded site in a list of private development opportunities near Littlerock and Trosper roads. Any development on the property must include either 40 residential units or a 2.4-acre park, according to the city.
Thurston County property records show that BJR Holdings LLC, which owns Toyota of Olympia, bought the land in December. Property owners Dustin Rotter and Shane Rotter could not be reached for comment.
However, Olympia officials are preparing for the possibility of losing the auto retailer. In a Jan. 27 study session with the Olympia City Council regarding future funding gaps in the budget, City Manager Steve Hall mentioned the “potential loss of car sales tax” from a large dealership, but declined to name the business.
This week, Hall told The Olympian that he has no “firsthand knowledge” regarding Toyota of Olympia’s plans. He said one priority for the city’s future economic development director is to focus on retaining and expanding major employers such as the Olympia Auto Mall. The goal is to hire the director this summer, Hall said.
Since 2009, motor vehicles (and parts) have been responsible for 14 percent to 18 percent of Olympia’s sales tax revenue, according to city budgets. The 2015 operating budget assumes the city will receive $16.4 million in general sales tax primarily from three sources: retail, automotive and construction. Sales tax revenue equals roughly 25 percent of Olympia’s general fund of about $64.5 million, which pays for basic city operations such as police and fire protection.
Regardless of what happens to the Toyota dealership, Olympia Mayor Stephen Buxbaum said the city needs to think strategically about how to grow and diversify its sales tax base.
“It is in the city’s interest to make sure the Auto Mall is functioning in a good way,” said Buxbaum, adding that he has not had any direct conversations with the Toyota retailer. “My own interest is to make sure the city is thoughtful and responsive to our local businesses.”